Opinion
F078501
06-21-2021
MICHAEL BLUE, Plaintiff and Appellant, v. BOARD OF RETIREMENT OF THE KERN COUNTY EMPLOYEES' RETIREMENT ASSOCIATION, Defendant and Appellant.
Law Office of Steven R. Rosales and Steven R. Rosales for Plaintiff and Appellant. Margo A. Raison, County Counsel, and Phillip T. Jenkins, Deputy County Counsel, for Defendant and Appellant.
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Kern County. No. BCV-17-101570 Eric Bradshaw, Judge.
Law Office of Steven R. Rosales and Steven R. Rosales for Plaintiff and Appellant.
Margo A. Raison, County Counsel, and Phillip T. Jenkins, Deputy County Counsel, for Defendant and Appellant.
OPINION
HILL, P.J.
Michael Blue applied for a service-connected permanent disability retirement with Kern County Employees' Retirement Association's Board of Retirement (KCERA), and upon denial, filed a writ petition for administrative mandamus with the trial court. The trial court reversed, and KCERA appeals from the judgment granted in favor of Blue. Blue cross-appeals on issues of prejudgment interest and attorney fees. Finding the trial court did not properly utilize the required standard of review, we reverse.
FACTUAL AND PROCEDURAL BACKGROUND
Blue was employed as a deputy sheriff of Kern County starting in 2005. In June 2011, Blue had a violent confrontation with a suspect who was resisting arrest. The confrontation culminated in Blue fatally shooting the suspect.
Blue thereafter began to have intrusive thoughts about the confrontation and the shooting, and was referred to the sheriff's department psychologist, Dr. Solano. Blue last worked as a deputy sheriff in March of 2012.
The record does not contain Dr. Solano's first name.
Blue received psychological treatment from Dr. Kathleen Murphy and medical treatment from Dr. Irene Sanchez. Dr. John M. Stalberg, the agreed medical examiner for workers' compensation purposes, performed two psychiatric examinations of Blue. Drs. Murphy, Sanchez, and Stalberg diagnosed Blue with post-traumatic stress disorder (PTSD) and issued permanent restrictions of no police work due to work-related PTSD.
Blue applied to KCERA for a service-connected disability retirement allowance on June 14, 2013, pursuant to Government Code section 31720. Dr. James O'Brien, KCERA's reviewing medical officer, evaluated the reports regarding Blue prepared by Drs. Murphy, Sanchez, and Stalberg and concluded that there was insufficient evidence of occupational incapacity to warrant disability retirement.
KCERA's Staff Disability Application Group notified Blue that his service-connected disability retirement allowance application had been denied on or about March 14, 2016, and granted Blue's request for an evidentiary hearing on that issue. That evidentiary hearing was held in October 2016 before Mr. Duane Bennett, one of KCERA's referees, and the matter was briefed and submitted thereafter.
On February 10, 2017, Bennett submitted his proposed decision recommending denial of Blue's service-connected disability retirement application, having found no substantial evidence to support a finding that Blue was permanently incapacitated from performing his regular duties.
On April 13, 2017, KCERA notified Blue that it had adopted Bennett's recommendation, finding that Blue was not permanently incapacitated.
On July 11, 2017, Blue filed a verified petition in the Kern County Superior Court for a writ of administrative mandamus pursuant to Code of Civil Procedure section 1094.5.
All further statutory references are to the Code of Civil Procedure unless otherwise indicated.
On May 1, 2018, Blue filed a motion for peremptory writ of mandamus in the Kern County Superior Court.
The case proceeded to a bench trial on July 31, 2018, with both Blue and KCERA presenting evidence and argument in support of their respective positions on the issues at hand.
On August 6, 2018, the trial court issued its ruling granting Blue's petition for peremptory writ of mandate, awarded Blue costs, but denied attorney fees. In its ruling, the court indicated it had found that a “preponderance of the substantial evidence supports the determination that [Blue] is permanently incapacitated from working as a deputy sheriff due to a service-connected mental injury, PTSD, arising from the shooting incident that occurred while [Blue] was on the job in June 2011.” The court went on to note that while it considered “Dr. O'Brien's conclusions and commentary to have evidentiary value, the weight of the substantial evidence, and particularly Dr. Stalberg's conclusions, support [Blue's] claim.” The court further noted that in its view, “this is a close case and the parties should bear their own attorneys' fees.”
On August 20, 2018, Blue submitted a proposed statement of decision and, at some point, submitted a proposed judgment to the trial court.
The date of submission of Blue's proposed judgment is not clear from the record, but it occurred before August 30, 2018, when the trial court adopted it as its final judgment.
On August 30, 2018, the trial court adopted and issued both Blue's proposed judgment and proposed statement of decision as its own judgment and statement of decision. On that same day, however, KCERA filed objections to Blue's proposed judgment. The next day, on its own motion, the trial court vacated its judgment, pending its ruling on KCERA's objections to Blue's proposed judgment.
On September 4, 2018, KCERA also filed objections to Blue's proposed statement of decision.
On October 10, 2018, the trial court held a hearing on KCERA's objections to Blue's proposed statement of decision and proposed judgment. The court overruled all of KCERA's objections to Blue's proposed statement of decision and adopted Blue's proposed statement of decision as its final decision in the matter. The court sustained KCERA's objection to Blue's proposed judgment request for prejudgment interest, finding no unreasonable delay in KCERA's evaluation and adjudication of Blue's disability retirement application.
On October 19, 2018, the trial court issued its new judgment on Blue's petition for writ of mandate.
On December 3, 2018, KCERA filed its notice of appeal.
On December 19, 2018, Blue filed his cross-appeal.
DISCUSSION
KCERA contends that the trial court failed to give KCERA's decision denying Blue's disability retirement application the required strong presumption of correctness when utilizing the “independent judgment” standard of review for administrative writs, and that the trial court's decision to reverse the finding of KCERA in this regard was fundamentally tainted thereby. KCERA also contends that the trial court cannot grant prejudgment interest in a disability retirement case back to a period before the employee had proven he was entitled to the retirement benefit. Blue disputes these contentions and on cross-appeal contends that he is entitled to legal interest on eligible retroactive disability retirement benefits predating the “initial wrongful denial” of March 14, 2016, and that he is entitled to attorney fees in this case pursuant to Government Code section 31536.
I. Applicable Law and Standard of Review
Section 1094.5 sets out the writ of mandate procedure for obtaining judicial review by the trial court of a final administrative determination. While section 1094.5 does not, on its face, specify which cases are subject to independent judgment review, the California Supreme Court has concluded that when a fundamental right (such as continued employment or professional licensure) is the subject of an administrative determination, the reviewing court must “ ‘exercise its independent judgment on the facts, as well as on the law ….' ” (Fukuda v. City of Angels (1999) 20 Cal.4th 805, 811 (Fukuda).) In conducting such an independent review of an administrative determination, “the record of the administrative board shall come before the court endowed with a strong presumption in favor of its regularity and propriety in every respect” and “the burden shall rest upon the petitioner to support his challenge affirmatively, competently, and convincingly. In other words, rarely, if ever, will a board determination be disturbed unless the petitioner is able to show a jurisdictional excess, a serious error of law, or an abuse of discretion on the facts.” (Id. at p. 814.)
This “presumption of correctness” imposes upon the party contesting an administrative action a burden of proof (not merely a burden of production) to provide evidence sufficient to show the “jurisdictional excess, a serious error of law, or an abuse of discretion” necessary to rebut the presumed correctness of the underlying administrative decision. (Fukuda, supra, 20 Cal.4th at pp. 814, 819.) In carrying out its independent review, the trial court must impose upon the petitioner the burden of showing that the agency's findings are contrary to the weight of the evidence. (Id. at p. 817.) If the evidence is evenly balanced, the party having the burden of proof loses. (Id. at p. 824.)
When the losing party appeals, the trial court's judgment is presumed to be correct, and the appellant bears the burden to affirmatively demonstrate prejudicial error. (Foreman & Clark Corp. v. Fallon (1971) 3 Cal.3d 875, 881; In re Marriage of Behrens (1982) 137 Cal.App.3d 562, 575 [“ ‘[t]he burden is on the appellant, not alone to show error, but to show injury from the error' ”].) KCERA and Blue each have the burden of proof of establishing their respective asserted errors on appeal. (Evid. Code, § 500; Barrie v. California Coastal Com. (1987) 196 Cal.App.3d 8, 16.)
We review the trial court's ruling under the substantial evidence standard, “[e]ven when as here, the trial court is required to review an administrative decision under the independent judgment standard of review.” (Fukuda, supra, 20 Cal.4th at pp. 813, 824.) Specifically, we review the trial court's independent, factual determination regarding the weight of the evidence in the record in relation to the agency's findings under the substantial evidence standard and determine whether substantial evidence in the administrative record supports the trial court's ruling. (Id. at p. 824; Bixby v. Pierno (1971) 4 Cal.3d 130, 143, fn. 10.) Pure questions of law, however, we review de novo. (Bostean v. Los Angeles Unified School Dist. (1998) 63 Cal.App.4th 95, 107-108.)
In this case, the question presented-whether the trial court applied the correct standard of review-is a question of law. If the trial court did not apply the correct standard of review, we have no choice but to reverse and remand to allow the trial court to reconsider the case in light of the correct standard. (Barber v. Long Beach Civil Service Com. (1996) 45 Cal.App.4th 652, 660.)
II. Analysis
KCERA asserts that the record in the instant case reveals that the trial court did not accord KCERA's decision the requisite degree of deference, specifically failing to apply a strong presumption of correctness. Blue counters that the court did accord KCERA's decision a “strong presumption of correctness, ” even though on the facts of this case it was not legally obligated to do so.
The proper application of the independent judgment standard of review was the subject of an extended colloquy at the October 10, 2018 hearing of this matter. In response to KCERA's initial inquiry as to how the independent judgment standard was applied, the trial court stated: “[W]hat happened was the Court weighed the evidence. And I only considered substantial evidence.… And if the weight of the substantial evidence which is expressed in the statement of decision as a preponderance, that seems to be an appropriate way to do it.” The court's comments, however, did not reference the required strong presumption in favor of the regularity and propriety of KCERA's decision. In fact, when KCERA remarked at the hearing upon the need for such a predicate presumption, the court asked, “[I]s there some other magic language that is supposed to be used when the Court independently weighs the evidence and comes to a decision?” The court's reference to “magic language” suggests the court misunderstood the importance of the presumption of correctness as a substantive, analytical predicate.
This misunderstanding is further suggested by the trial court's subsequent observation, “I'm not sure what those magic words would be at this point.” We note, however, the strong presumption of correctness required by the independent review standard is a matter of fundamental analytical importance. (See Fukuda, supra, 20 Cal.4th at p. 812; Shenouda v. Veterinary Medical Bd. (2018) 27 Cal.App.5th 500, 512 [“ ‘ “[t]he findings of a board where formal hearings are held … come before the courts with a strong presumption in their favor based primarily on the [rebuttable] presumption contained in … [Evidence Code section 664] ‘[t]hat official duty has been regularly performed' ”' ”].) “ ‘Obviously considerable weight should be given to the findings of experienced administrative bodies made after a full and formal hearing, especially in cases involving technical and scientific evidence.' ” (Fukuda, at p. 812.)
The trial court requested decisional authority from KCERA to support its proposed working of the independent judgment review standard. The court asked, “Is there a case that says that somewhere, that if the Court independently weighs the evidence, finds that the evidence falls in favor of-the weight of the evidence falls in favor of the petitioner? Even though through my independent judgment that's what I decide, I'm nevertheless supposed to give deference to the administrative agency notwithstanding the fact that I think they were wrong?” This question again suggests misunderstanding regarding the correct standard of review, and the case law establishing it. In response, KCERA's counsel invited the court's attention to the Fukuda case.
Discussing KCERA's decision, the trial court stated: “I did not find a serious error in what [KCERA] did. What I found was based on my independent assessment of the evidence a preponderance of the substantial evidence weighed in favor of [Blue's] claim.” By describing its initial step of review as not finding “a serious error in what [KCERA] did, ” the court demonstrated that it did not begin from a presumption of correctness and that it instead exercised a completely independent review of the evidence before KCERA, ab initio. The court's misunderstanding was thereafter confirmed when the court stated: “I think that was a correct way to state what I did, which was to independently weigh the evidence and come to a judgment.” The court did not discuss how exactly (or whether) Blue carried his burden to convince the court that KCERA's decision was contrary to the weight of the evidence, as Blue was obligated to if the required strong presumption of the correctness of that decision had been applied. (See Fukuda, supra, 20 Cal.4th at p. 812.) Nor did the court state how (or if) Blue was able to show the kind of jurisdictional excess, serious error of law, or an abuse of discretion on the facts that the independent review standard's presumption of correctness requires to overcome such a presumption. (See id. at p. 814.)
The trial court's view of the merits of KCERA's underlying administrative decision as an evidentiary “close case” (rather than its assessment of how Blue showed that the weight of the evidence was sufficient to overcome the required presumption of correctness) is further shown by the court's statement that: “[W]e're not talking about a serious error any more than we're talking about when some jury has a close case and resolves it one way or the other. That's what I did. A close case was resolved one way or the other.” Again, the court appeared to give no deference to KCERA's underlying administrative decision; rather, the trial court began its review of that decision anew.
Confirming that it did not accord any meaningful degree of deference as an initial analytical step, the trial court went on to state: “Well, I think that it seems to me that once you tell a Superior Court judge that they have to exercise independent judgment, that that's what they're required to do regardless of what the administrative agency did. And it's not that I didn't take seriously or consider what the administrative agency did, it's that I had to exercise my own independent judgment.” (Italics added.) Unfortunately, this was not the correct standard.
In addition, the trial court's own statements on the record further suggest its misunderstanding as to the independent judgment standard of review. In synopsizing its position at the hearing of this matter, the court told KCERA's counsel: “So you have your record on this point, counsel. I don't know how else I can say it. I've stated this as clearly as I can. So when you file your appeal, you'll be able to show the Court of Appeal exactly what my thoughts were on this. It is a close case. I considered the-what [KCERA] did. I disagreed with it as I independently weighed the evidence and felt that the weight of the evidence which I expressed as a preponderance of the substantial evidence fell in favor of [Blue].” Following up on the subject, the court later stated: “I think that the transcript of this hearing probably is adequate for your purposes to the extent you wish to appeal, you know exactly what I meant by a preponderance of the substantial evidence.” “[P]reponderance of the substantial evidence” is not a presumption of correctness, pending a showing of error, however.
We recognize that this standard is not always easy for a trial court to apply, but here, based on the whole record, we must conclude the trial court misapplied the independent judgment standard in this case. While the bottom-line question for the trial court under the independent judgment standard was whether or not Blue showed that his evidence outweighed KCERA's, the court's failure to properly apply the presumption of correctness warrants remand. The fact that the court on remand might well reach the same substantive conclusion as it did previously in this case is not of determinative concern.
Because our reversal of the trial court's judgment and remand for further proceedings moots Blue's contentions regarding the award of prejudgment interest and attorney fees, we dismiss his cross-appeal.
DISPOSITION
The judgment is reversed, and the case is remanded to the trial court for a new evidentiary hearing on Blue's writ petition, with directions to properly apply the independent judgment standard of review. Blue's cross-appeal is dismissed as moot. KCERA is awarded costs on appeal.
WE CONCUR: DETJEN, J., PEÑA, J.